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One way I deal with something like this is to delete the item offline using linux. You can download Puppy linux here. Burn the lupu-528.005.iso iso file in XP using isoburner or Nero if you have it. Imgburn also will burn an iso file. Boot the Puppy disk. Your hard drive will appear in the lower left of the puppy desktop. If you have one drive it will be called sda1. Click once on the icon and a File Manager Window will open. Browse to the n folder in your My Documents folder. C:\Documents and Settings\<your user name>\My Documents. You only need to click once on a folder to open it.

Right click on the folder and select delete. Make sure you have the correct folder as this is a final operation and you will not get the folder back. Once deleted I would start a new thread in the "Am I infected" forum especially if after deleting the n folder you get another folder with a file you do not recognize.

Interesting. I am wondering if some infection is preventing you from doing this. Can you check if the MD5 hash of your downloaded file is the same as the one posted on the puppy site. You can use this to check the md5 of your download and compare it to this one..

8ad170c46b523436776398fa5ce39fa4

If it is the same download Rufus in an admin account to create a bootable USB flashdrive. Attach your flash drive before you run Rufus. Select MBR as the partition scheme. Everything else is defaults. In the dropdown box that shows Freedos select iso image. Click the icon next to the dropdown box and browse to the Puppy iso file. Press Start. Any data on the flashdrive will be overwritten so back up anything you need on the drive.

You may have to change the boot order in BIOS so your USB is first boot device. You may also have a key to get to a boot menu. What is the make and model of the computer?